The effects of student loan debt on graduates' financial and life decisions in the UK and USA

Project methods

The research will consist of:

A literature review of extant research on the effects of graduate debt on their financial and life decisions;

analysis of various national secondary data sources in the UK and US;

an online survey of approximately 4,000 English graduates;

follow-up focus groups or interviews with English graduates; and

analysis, writing up, and dissemination of findings.

The thrust of the methodological approaches used to examine graduate indebtedness will be different in England and the US.

In England, a survey of a nationally representative sample of around 4,000 graduates will be conducted. The sample size allows for stratification, for instance, by students graduating in different years; with varying levels of debt; and in contrasting labour market conditions.

Most English graduates surveyed will have graduated 6-8 years earlier, long enough to have established themselves in a career, and to be engaging in the behaviours we want to measure (and to be graduates of the 2006 English funding changes). We also will include some graduates from the 2012/13 English funding regime who will have graduated for about two years. The surveys will ask about graduates’ behaviour, such as: whether they have purchased a house, have married, had children, are paying into a pension scheme, and the factors influencing their job choices, alongside their perceptions of the impact of debt on their life choices.

In the US, there are considerable challenges in surveying a representative sample of institutions and students in the USA to ascertain student loan repayment and debt issues because of the diversity of the HE system and the loan schemes. Therefore secondary sources will be used rather than a survey instrument.

National-level extant data sources already available in the USA will be employed. These data bases include, but are not limited to, cross-sections, panels/longitudinal data sets available from the National Center for Education Statistics and other federal government sources.

The data collected and analysed will not establish a causal link between student debt and particular behaviours but will provide data on graduates’ perceptions of the impact of indebtedness.

The researchers will explore implications for policy on student finance, including the role and design of student loans; and the larger implications for theories of policy convergence and cross-border policy borrowing, and for the structures of social inequality.